Chapter 1
Graphing Data
A graph is made by plotting the values of two variables
x and y
at a point that corresponds to their values
measured along the xaxis and yaxis.
A scatter diagram is a graph that plots the values of two variables for a number of different values of each.
A scatter diagram shows the relationship between the two variables. It shows whether they are positively
related, negatively related or unrelated.
Graphs Used in Economic Models
Graphs are used to show relationships among variables in economic models.
Relationships can be positive (an upwardsloping curve), negative (a downwardsloping curve, positive and
then negative (have a maximum point), negative and then positive (have a minimum point), or unrelated (a
horizontal or vertical curve).
The Slope of a Relationship
The slope of a relationship is calculated as the change in the value of the variable measured on the yaxis
divided by the change in the value of the variable measured on the xaxis.
A straight line has a constant slope.
A curved line has a varying slope. To calculate the slope of a curved line, we calculate the slope at a point or
across an arc.
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 Fall '12
 Boop
 Economics, Microeconomics

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